Revaluation 2010 and transitional arrangements

All rateable values are reassessed every five years at a general revaluation. The current rating list is based on the 2010 revaluation. Five-yearly revaluations make sure each ratepayer pays their fair contribution and no more, by ensuring that the share of the national rates bill paid by any one ratepayer reflects changes over time in the value of their property relative to others. Revaluation does not raise extra money for Government.

Whilst the 2010 revaluation will not increase the amount of rates collected nationally, within this overall picture, over a million properties will see their business rate liabilities reduced and some ratepayers will see increases.

For those that would otherwise see significant increases in their rates liability, the Government has put in place a £2 billion transitional relief(pdf, 16KB) scheme to limit and phase in changes in rate bills as a result of the 2010 revaluation. To help pay for the limits on increases in bills, there also have to be limits on reductions in bills. Under the transition scheme, limits continue to apply to yearly increases and decreases until the full amount is due (rateable value times the appropriate multiplier). The scheme applies only to the bill based on a property at the time of the revaluation. If there are any changes to the property after 1 April 2010, transitional arrangements will not normally apply to the part of a bill that relates to any increase in rateable value due to those changes. Changes to your bill as a result of other reasons (such as because of changes to the amount of Small Business Rate Relief) are not covered by the transitional arrangements.

To calculate your transitional adjustment we will take your Rateable Value on the 31 March multiplied by the small business multiplier on that date: 0.481 (called your "base liability") and apply a percentage (called an "appropriate fraction") which is prescribed by the government and shown in the table below. We then adjust this to take account of the relevant rate of inflation 0.986. The result is to limit the amount by which your rates can increase or decrease each year.

The rules about Transitional adjustments are complex. If you have any queries about the amount of the adjustment shown on your bill contact us.

Note: small properties are defined as those properties with rateable values below £25,500 in Greater London or £18,000 elsewhere.

The transitional arrangements are applied automatically and are shown on the front of the bill.

Further information about transitional arrangements and other reliefs may be obtained from the Business Rates Team or the website www.businesslink.gov.uk.

More information on revaluation 2010 can be found at www.voa.gov.uk.